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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: MikeM54321 who wrote (5299)	5/6/1998 1:32:00 AM
From: eabDad	Read Replies (1) \| Respond to of 10921

Forgive a newcomer for reminding people what the name of this thread is! To reiterate what I said in an earlier post, my experience is that stock prices are mostly set and trend according to two things above all else - expectation of future fundamentals and investor psychology. Mutual fund managers, who drives the money in the market, are looking past the troubles today and believe that by Q4 everything will be in a recovery mode. Will it be that way? Who knows ... but that is what is being written by analysts today. And for the most part, they are writing what they hear from their industry sources and Street contacts. Investor psychology is best described by what emotions mutual fund managers have about a sector in general, and the relative risks in valuation vs. potential return. A point of fact, while volatile, this sector has made good returns for investors quickly. In short, this is a sector investors cannot hate for too long, and love to be in - because it in some ways is the most mysterious of technologies, and also tied to building infrastructure. I listened to the November-1996 AMAT earnings call, but was most fascinated by the energy and emotion of the people asking questions. How questions are asked is much more valuable than the answers. AMAT did not particularly say much, but every possible positive spin was placed into the questions. After the call, I knew that was the time to buy and not look back. Is the investor that enthusiastic today. No, I do not think so, but I think they will try and squeeze out positive answers in their questions next week. Future fundamentals - plus Investor psychology - plus Today's fundamentals - stink All in all, I think by August or Sept. the sector should be 30-40% higher than today. The only number that matters in next week's AMAT call is the booking number, today placed between $900-950 million. If they do not make $900 million, or give guidance below $800 million in any subsequent quarter, we have a rough number of weeks until the rebound really starts. Z